HARARE – Toronto Stock Exchange-listed Chimata Gold Corporation is looking to acquire Zimbabwe Lithium Company, which was recently granted exclusive development rights for the Kamativi lithium tailings deposit at the Kamativi Tin mine.
Chimata Gold is a Canadian mineral exploration company that is focused on the acquisition and exploration of properties of merit with a focus on gold and other precious metals. The group has announced that it has signed a “binding letter of intent” with Mauritian-headquartered Zimbabwe Lithium Company Limited.
“Chimata Gold Corp…has entered into a binding letter of intent (LOI) with Zimbabwe Lithium Company (Mauritius) Limited (ZIM), a privately held company incorporated under the laws of Mauritius.
“Pursuant to the terms of the LOI, Chimata will subscribe to the share capital of ZIM for an initial subscription of 19 percent of ZIM’s share capital in exchange for the allocation by Chimata of an amount of shares representing 19 percent of its then issued and outstanding share capital to ZIM, such amount being calculated post-closing of the concurrent financing…..with right to further acquire the remaining issued and outstanding share capital of ZIM upon the fulfilling of certain terms and conditions as set out in the LOI, the whole resulting in ZIM becoming a subsidiary of Chimata,” said the group in a notice to the TSX.
“ZIM will be focused on developing lithium mining properties and assets located in Zimbabwe held by ZIM and related companies wholly owned by ZIM’s principals.”
Zimbabwe Lithium recently signed a joint-venture agreement with the Zimbabwe Mining Development Corporation (ZMDC) with respect to the grant of exclusive development rights for the Kamativi lithium tailings deposit at the Kamativi Mine, which is located in the Matabeleland North Province.
This tailings stockpile has been surveyed to give an estimated 23 168 000 metric tonnes of historical tailings material on surface.
With regards to the proposed transaction, Chimata said in order to finance the transaction, it will complete a non-brokered private placement of up to two million canadian dollars (CAD$2 000 000) by the issuance of units of Chimata at a price of $0, 15 per unit, each unit being comprised of one common share in the share capital of Chimata and one half common share purchase warrants, each full warrant entitling its holder to purchase one common share in the share capital of Chimata at a price of $0, 25 per common share for a period of 12 months.
The mining firm said it currently has an exclusive right to complete the transaction with Zimbabwe Lithium. Commenting on the development, Chimata chairman Mr Groome said:
“We are encouraged and excited by the recent changes in Zimbabwe. We believe that these changes signal an important investment opportunity. Zimbabwe is very rich in mineral assets and remains, in my opinion, one of the most attractive destinations in Africa. We look forward to working with the Zimbabwe Government, ZMDC and our operating partners at ZIM in building a rapidly emerging capital efficient lithium supplier to the world”.
And Zimbabwe Lithium MD Mr John McTaggart commented:
“We are very pleased to have on board a partner in Chimata. In particular, during this very important and dynamic transition period in Zimbabwe, we would like to thank the Government of Zimbabwe, the Honourable Minister of Mines and Mining Development, our partners at ZMDC and all stakeholders that have worked with us to bring this project to its current stage.”
The presently mothballed Kamativi tin mine, is located approximately 185 kilometres east-south-east of Victoria Falls, approximately 84 km by tar road east of Hwange and approximately 310 km northwest of Bulawayo. It stopped operations in 1994 after the price of tin tumbled in 1985.